More broadly, just 30 percent of employees in America feel engaged at work,
according to a 2013 report by Gallup. Around the world, across 142
countries, the proportion of employees who feel engaged at work is just
13 percent. For most of us, in short, work is a depleting, dispiriting
experience, and in some obvious ways, it’s getting worse.
Demand
for our time is increasingly exceeding our capacity — draining us of
the energy we need to bring our skill and talent fully to life.
Increased competitiveness and a leaner, post-recession work force add to
the pressures. The rise of digital technology is perhaps the biggest
influence, exposing us to an unprecedented flood of information and
requests that we feel compelled to read and respond to at all hours of
the day and night.
Curious
to understand what most influences people’s engagement and productivity
at work, we partnered with the Harvard Business Review last fall to
conduct a survey of more than 12,000 mostly white-collar employees
across a broad range of companies and industries. We also gave the
survey to employees at two of The Energy Project’s clients — one a
manufacturing company with 6,000 employees, the other a financial
services company with 2,500 employees. The results were remarkably
similar across all three populations.
Employees
are vastly more satisfied and productive, it turns out, when four of
their core needs are met: physical, through opportunities to regularly
renew and recharge at work; emotional, by feeling valued and appreciated
for their contributions; mental, when they have the opportunity to
focus in an absorbed way on their most important tasks and define when
and where they get their work done; and spiritual, by doing more of what
they do best and enjoy most, and by feeling connected to a higher
purpose at work.
THE
more effectively leaders and organizations support employees in meeting
these core needs, the more likely the employees are to experience
engagement, loyalty, job satisfaction and positive energy at work, and
the lower their perceived levels of stress. When employees have one need
met, compared with none, all of their performance variables improve.
The more needs met, the more positive the impact.
Engagement
— variously defined as “involvement, commitment, passion, enthusiasm,
focused effort and energy” — has now been widely correlated with higher
corporate performance. In a 2012 meta-analysis of 263 research studies
across 192 companies, Gallup found that companies in the top quartile
for engaged employees, compared with the bottom quartile, had 22 percent
higher profitability, 10 percent higher customer ratings, 28 percent
less theft and 48 percent fewer safety incidents.
A
2012 global work force study of 32,000 employees by the consulting
company Towers Watson found that the traditional definition of
engagement — the willingness of employees to voluntarily expend extra
effort — is no longer sufficient to fuel the highest levels of
performance. Willing, it turns out, does not guarantee able. Companies
in the Towers Watson study with high engagement scores measured in the
traditional way had an operating margin of 14 percent. By contrast,
companies with the highest number of “sustainably engaged” employees had
an operating margin of 27 percent, nearly three times those with the
lowest traditional engagement scores.
Put
simply, the way people feel at work profoundly influences how they
perform. What our study revealed is just how much impact companies can
have when they meet each of the four core needs of their employees.
Renewal:
Employees who take a break every 90 minutes report a 30 percent higher
level of focus than those who take no breaks or just one during the day.
They also report a nearly 50 percent greater capacity to think
creatively and a 46 percent higher level of health and well-being. The
more hours people work beyond 40 — and the more continuously they work —
the worse they feel, and the less engaged they become. By contrast,
feeling encouraged by one’s supervisor to take breaks increases by
nearly 100 percent people’s likelihood to stay with any given company,
and also doubles their sense of health and well-being.
Value:
Feeling cared for by one’s supervisor has a more significant impact on
people’s sense of trust and safety than any other behavior by a leader.
Employees who say they have more supportive supervisors are 1.3 times as
likely to stay with the organization and are 67 percent more engaged.
Focus:
Only 20 percent of respondents said they were able to focus on one task
at a time at work, but those who could were 50 percent more engaged.
Similarly, only one-third of respondents said they were able to
effectively prioritize their tasks, but those who did were 1.6 times
better able to focus on one thing at a time.
Purpose:
Employees who derive meaning and significance from their work were more
than three times as likely to stay with their organizations — the
highest single impact of any variable in our survey. These employees
also reported 1.7 times higher job satisfaction and they were 1.4 times
more engaged at work.
We
often ask senior leaders a simple question: If your employees feel more
energized, valued, focused and purposeful, do they perform better? Not
surprisingly, the answer is almost always “Yes.” Next we ask, “So how
much do you invest in meeting those needs?” An uncomfortable silence
typically ensues.
The
most obvious answer is that systematically investing in employees,
beyond paying them a salary, didn’t seem necessary until recently. So
long as employees were able to meet work demands, employers were under
no pressure to address their more complex needs. Increasingly, however,
employers are recognizing that the relentless stress of increased demand
— caused in large part by digital technology — simply must be
addressed.
Still,
the forces of habit and inertia remain powerful obstacles to better
meeting employee needs. Several years ago, we did a pilot program with
150 accountants in the middle of their firm’s busy tax season.
Historically, employees work extremely long hours during these demanding
periods, and are measured and evaluated based on how many hours they
put in.
Recognizing
the value of intermittent rest, we persuaded this firm to allow one
group of accountants to work in a different way — alternating highly
focused and uninterrupted 90-minute periods of work with 10-to-15-minute
breaks in between, and a full one-hour break in the late afternoon,
when our tendency to fall into a slump is higher. Our pilot group of
employees was also permitted to leave as soon as they had accomplished a
designated amount of work.
With
higher focus, these employees ended up getting more work done in less
time, left work earlier in the evenings than the rest of their
colleagues, and reported a much less stressful overall experience during
the busy season. Their turnover rate was far lower than that of
employees in the rest of the firm. Senior leaders were aware of the
results, but the firm didn’t ultimately change any of its practices. “We
just don’t know any other way to measure them, except by their hours,”
one leader told us. Recently, we got a call from the same firm. “Could
you come back?” one of the partners asked. “Our people are still getting
burned out during tax season.”
Partly,
the challenge for employers is trust. For example, our study found that
employees have a deep desire for flexibility about where and when they
work — and far higher engagement when they have more choice. But many
employers remain fearful that their employees won’t accomplish their
work without constant oversight — a belief that ironically feeds the
distrust of their employees, and diminishes their engagement.
A
truly human-centered organization puts its people first — even above
customers — because it recognizes that they are the key to creating
long-term value. Costco, for example, pays its average worker $20.89 an hour,
Businessweek reported last year, about 65 percent more than Walmart,
which owns its biggest competitor, Sam’s Club. Over time, Costco’s huge
investment in employees — including offering benefits to part-time
workers — has proved to be a distinct advantage.
Costco’s
employees generate nearly twice the sales of Sam’s Club employees.
Costco has about 5 percent turnover among employees who stay at least a
year, and the overall rate is far lower than that of Walmart. In turn,
the reduced costs of recruiting and training new employees saves Costco
several hundred million dollars a year. Between 2003 and 2013, Costco’s
stock rose more than 200 percent, compared with about 50 percent for
Walmart’s. What will prompt more companies to invest more in their
employees?
Pain
is one powerful motivator. Often companies seek out our services when
they’ve begun losing valued employees, or a C.E.O. recognizes his own
exhaustion, or a young, rising executive suddenly drops dead of a heart
attack — a story we’ve been told more than a half dozen times in just
the past six months.
In
a numbers-driven world, the most compelling argument for change is the
growing evidence that meeting the needs of employees fuels their
productivity, loyalty and performance. Our own experience is that more
and more companies are taking up this challenge — most commonly
addressing employees’ physical needs first, through wellness and
well-being programs. Far less common is a broader shift in the corporate
mind-set from trying to get more out of employees to investing more in
meeting their needs, so they’re both capable of and motivated to perform
better and more sustainably.
THE
simplest way for companies to take on this challenge is to begin with a
basic question: “What would make our employees feel more energized,
better taken care of, more focused and more inspired?” It costs nothing,
for example, to mandate that meetings run no longer than 90 minutes, or
to set boundaries around when people are expected to answer email and
how quickly they’re expected to respond. Other basic steps we’ve seen
client companies take is to create fitness facilities and nap rooms, and
to provide healthy, high-quality food free, or at subsidized prices, as
many Silicon Valley companies now do.
It
also makes a big difference to explicitly reward leaders and managers
who exhibit empathy, care and humility, and to hold them accountable for
relying on anger or other demeaning emotions that may drive short-term
results but also create a toxic climate of fear over time — with
enormous costs. Also, as our study makes clear, employees are far more
engaged when their work gives them an opportunity to make a positive
difference in the world.
The
energy of leaders is, for better or worse, contagious. When leaders
explicitly encourage employees to work in more sustainable ways — and
especially when they themselves model a sustainable way of working —
their employees are 55 percent more engaged, 53 percent more focused,
and more likely to stay at the company, our research with the Harvard
Business Review found.
Mr.
Kissam, the Albemarle chief executive Tony first met more than a year
ago, has taken up the challenge for himself and his employees. He began
by building breaks into his days — taking a walk around the block — and
being more fully focused and present during time with his family. He now
sets aside at least one morning on his calendar every week for
reflection and thinking longer term. He has also made it a practice to
send out handwritten notes of appreciation to people inside and outside
the company.
Mr.
Kissam has also championed a comprehensive rethinking of his
organization’s practices around meetings, email, flexible work
arrangements, conflict resolution and recognition. By the end of 2014
more than 1,000 of his leaders and managers will have gone through a
program aimed at helping them more skillfully meet their own needs, and
the needs of those they oversee.
“I
can already see it’s working,” Mr. Kissam told us. “Our safety record
has improved significantly this year, because our people are more
focused. We’re trusting them to do their jobs rather than telling them
what to do, and then we’re appreciating them for their efforts. We’re
also on the right path financially. A year from now it’s going to show
up in our profitability. I saw what happened when I invested more in
myself, and now we’re seeing what happens when we invest in our
employees.”
Tony Schwartz is the chief executive of The Energy Project,
a consulting firm. Christine Porath is an associate professor at
Georgetown University’s McDonough School of Business and a consultant to
The Energy Project.
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